Question

Use the formula for computing future value using compound interest to determine the value of an account at the end of 5 years if a principal amount of $2,500 is deposited in an account at an annual interest rate of 6% and the interest is compounded daily. Assume there are 365 days in a year. Do not round until the end of your calculations; then, round to the nearest cent as needed

Answer 1

Do you know the formula?

Answer 2

( Of course I know, but I'd like you to learn the essential concept!)

Answer 3

NO idea!

Answer 4

It's compounded interest formula!

Answer 5

A=P(1+r/n)^2

Answer 6

A = P ( 1 + r/n ) ^ ( n * t)

Answer 7

Does it look familiar at all?

Answer 8

yeah, kind of..

Answer 9

" annual interest rate of 6% and the interest is compounded daily "
=> .06 / 365

Answer 10

would the C.I be 845.56

Answer 11

What's C.1?

Answer 12

compound interest

Answer 13

so the total would be 3345.56?

Answer 14

Mine is 3374.56

Answer 15

Hold on, let triple check!

Answer 16

yep, $ 3374.56

Answer 17

okay! thank you!